Vancouver is experiencing an incredibly competitive market for homebuyers. The best way to ensure that you secure the home of your dreams is to be well prepared! Here are some common mistakes that you should be aware of to help make your home buying endeavours a happy and stress-free experience:
1. Failing to use the services of a professional REALTOR®
Many times buyers avoid using the services of a realtor under the mistaken belief that it costs them money or that they will be able to negotiate a better deal directly with the seller or seller’s realtor. This can be an expensive mistake. The buyer’s realtor is almost always paid from the commission that the seller is charged; therefore, you can have your own experienced realtor, working solely for your benefit, at no charge to you. If you negotiate directly with the seller or seller’s agent, you may not be taking advantage of the best deal available in the market-place. Real estate is a unique business where a conscientious, professional realtor can help you to avoid costly mistakes. This can greatly help to make your home buying adventure enjoyable and stress-free.
2. Not knowing who the Realtor is really working for
It is important for buyers to know and understand for whom the realtor helping them is actually working for. If they are not specifically in an agency contract with you, the realtor that you meet at an open house will be representing the seller’s best interests. Your realtor must fully explain agency, including dual-agency and no-agency. When negotiations begin, wouldn’t you want to know whether the information you divulge will be used for the seller’s benefit or for yours?
3. Failing to review a Comparative Market Analysis before an offer
Before you make an offer to purchase that special home, you must have a good idea what the market value is to ensure you do not overpay. Your realtor can prepare a Comparative Market Analysis showing what similar homes have recently sold for, and the difference between the asking and selling prices. This is the same type of report the seller receives when deciding on an asking price. Wouldn’t you like to have access to the same information as the seller?
4. Failing to recognize different negotiating styles and strategies
Many buyers think that the way to achieve a fair purchase price is by submitting a low offer. Many times this type of strategy will polarize negotiations and lead to inflexibility on the part of the seller, or worse yet, failed negotiations. Your realtor will be able to show you the most effective strategies for each particular situation.
5. Failing to have a home inspected by a competent home inspector
Buying a home is a major purchase, often made after spending just half an hour looking at the home. Ensure you will not be surprised later with deficiencies that might cost thousands. Your realtor can recommend several reputable companies for you to choose from, and will ensure the appropriate clause is inserted in the offer.
6. Not knowing or understanding your rights and obligations as set out in the offer to purchase
It is important to understand completely the terms of the Contract of Purchase and Sale. Wrong assumptions, poorly written or missing clauses, and not understanding how the clauses affect the purchase can lead to increased costs or a void contract. A competent realtor can thoroughly explain the agreement to you and help you to fulfill your contractual obligations.
7. Letting emotion blind reason
Buying a home is an exciting time and is usually an emotion filled process. It is important that those emotions be validated by facts and reason. Your realtor can help to remove the emotion from the negotiating process and provide you with the information you need to make the right decisions.
8. Failing to get pre-qualified before looking at homes
Knowing how much you can comfortably afford will ensure you are looking in the right price range and prevent you from buying a home that will strain you financially and emotionally. Having an interest rate guarantee will protect you in times of fluctuating rates and ensure that your initial projected payments do not suddenly escalate, resulting from increased interest charges. Your realtor can help you initiate this process and can also recommend alternative sources of financing.